A federal court has declined to overturn an FCC decision deregulating AT&T's special access lines and those of Embarq and Frontier.

The FCC had removed the "dominant pricing" regulations, while continuing to regulate interconnection and reasonable pricing per its Title II common carrier regulation of ILECs. The Ad Hoc Telecommunications Users Committee, representing self-described heavy users of those business broadband services, had asked the court to overturn that decision.

"The Court of Appeals has declined to disturb an FCC order that was out of step with marketplace realities," said the committee in a statment. "It is now up to the current FCC to do that."

The commission has been under some pressure from public interest groups and some industry players to reregulate special access lines.

Those special access lines are the "last mile" dedicated broadband lines to businesses, which incumbent local exchange carriers like AT&T dominate. By contrast, residential customers can generally choose from cable or phone lines for their service.

Competitor carriers who have to lease those lines had argued that the FCC's decision was arbitrary and capricious.

A three-judge panel of the D.C. Circuit of the U.S. Court of Appeals disagreed, deferring to the FCC's expertise, and calling the deregulation a "recalibration" that was "reasonable and reasonably explained."

"The FCC reached a hotly debated and eminently debatable, but ultimately reasonable, conclusion that eliminating the extra layer of dominant-carrier pricing regulation on the ILECs' special access lines - while leaving in place basic Title II common-carrier regulation - will better promote competition and the public interest. We find no legal basis to upset the FCC's policy judgment," the court concluded.